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Thread: Here Comes The Bounce? - May 9, 2012

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  1. #1
    Quote Originally Posted by TraderD View Post
    Hi Billy,

    How does a GDX MF climb from a bottom of -1.0% to -0.6% at the close yesterday bode with a gap down below QS2 at the open today? Would you say it ain't over till the fat lady starts to sing (at -1.45%)?

    Trader D
    It is pretty difficult to keep a clear head when there is a conflict between traders who expect a bounce - and trade a bounce during the day - and overnight news from abroad. The easiest is to wait for a buy signal. If it is a weak buy signal, I'll again buy leaps using "stop loss" money. If it is a strong buy, I'll buy GDX without leverage. However, I still expect a bounce for US markets. It is not like Lehman: I believe that funds have been prepared/protected against a potential market/Euro collapse and they know that the FED is back-stopping everything. I will change my mind when I see -400 points on the Dow in one day.


    Pascal

  2. #2
    Join Date
    May 2011
    Location
    South Florida
    Posts
    51
    Quote Originally Posted by Pascal View Post
    It is pretty difficult to keep a clear head when there is a conflict between traders who expect a bounce - and trade a bounce during the day - and overnight news from abroad. The easiest is to wait for a buy signal. If it is a weak buy signal, I'll again buy leaps using "stop loss" money. If it is a strong buy, I'll buy GDX without leverage. However, I still expect a bounce for US markets. It is not like Lehman: I believe that funds have been prepared/protected against a potential market/Euro collapse and they know that the FED is back-stopping everything. I will change my mind when I see -400 points on the Dow in one day.

    Pascal
    The FED is clearly not listening to traders' wishful thinking and only they know when it's time to change the tune from "No QE" to "Now QE". The part that I'm pondering is whether there is any real smart money left out there that is able to figure out where to put stake in the ground for accumulation/distribution. We could be following ghosts otherwise.

    Trader D

  3. #3
    Quote Originally Posted by TraderD View Post
    The FED is clearly not listening to traders' wishful thinking and only they know when it's time to change the tune from "No QE" to "Now QE". The part that I'm pondering is whether there is any real smart money left out there that is able to figure out where to put stake in the ground for accumulation/distribution. We could be following ghosts otherwise.

    Trader D
    As far as I can tell, this is an oversold bounce. Nothing says that it is sustainable. So yes, maybe ghosts!


    Pascal

  4. #4
    Join Date
    Oct 2011
    Location
    Brugge-Belgium
    Posts
    394
    Am I correct to conclude that the PM MF will go LONG if the MF remains above 0 at the close today?

  5. #5
    Looking at the below graph, it looks like no QE 3 so far, which is bearish for equity market. But of course it can change any minute (the graph is updated every two weeks. Choose 1 yr and redraw graph to see the details).

    http://research.stlouisfed.org/fred2/graph/?id=BASE

    Quote Originally Posted by Pascal View Post
    As far as I can tell, this is an oversold bounce. Nothing says that it is sustainable. So yes, maybe ghosts!


    Pascal

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